(McDonald's) The following figures are taken from the 2003 financial statements of McDonald's and Wendy's.! Figures are in million dollars.
|
McDonalds |
Wendy's |
| Inventory |
$129.40 |
$54.40 |
| Revenue |
17140.5 |
3148.9 |
| Cost of Goods Sold |
11943.7 |
1634.6 |
| Gross Profit |
5196.8 |
1514.4 |
a. In 2003, what were McDonald's inventory turns? What were Wendy's inventory turns?
b. Suppose it costs both McDonald's and Wendy's $3 (COGS) per their value meal offerings, each sold at the same price of $4. ASSW11e that the cost of inventory for both companies is 30 percent a year. Approximately how much does McDonald's save in inventory cost per value meal compared to that of Wendy's? You may assume the inventory turns are independent of the price.